Watts Water Technologies Inc (WTS)
Working capital turnover
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 2,048,400 | 1,972,700 | 1,803,100 | 1,494,900 | 1,586,400 |
| Total current assets | US$ in thousands | 1,061,000 | 950,600 | 861,500 | 709,500 | 734,900 |
| Total current liabilities | US$ in thousands | 405,800 | 378,700 | 408,500 | 312,800 | 419,300 |
| Working capital turnover | 3.13 | 3.45 | 3.98 | 3.77 | 5.03 |
December 31, 2023 calculation
Working capital turnover = Revenue ÷ (Total current assets – Total current liabilities)
= $2,048,400K ÷ ($1,061,000K – $405,800K)
= 3.13
The working capital turnover ratio for Watts Water Technologies, Inc. has exhibited a fluctuating trend over the past five years. In 2019, the company achieved a high working capital turnover ratio of 5.07, indicating that it generated $5.07 in revenue for every dollar of working capital invested.
Subsequently, the ratio decreased to 3.80 in 2020, suggesting a less efficient utilization of working capital to generate revenue. It then improved to 3.99 in 2021, reflecting a better performance in converting working capital into sales.
However, there was a slight decline in efficiency in 2022 with a ratio of 3.46, indicating a drop in the company's ability to generate revenue from its working capital compared to the prior year.
In the most recent year, 2023, the working capital turnover ratio further decreased to 3.14, continuing the downward trend in efficiency in utilizing working capital.
Overall, the trend in working capital turnover for Watts Water Technologies, Inc. shows a mix of fluctuations, suggesting varying levels of efficiency in managing working capital to generate revenue over the years. Further analysis of operational and financial strategies may be necessary to understand the factors influencing these fluctuations.
Peer comparison
Dec 31, 2023